A decision by the Indian Government to lift the restrictions on exports of cotton yarn as of last Friday, 1st April 2011, has been welcomed by the EU textiles and clothing Industry.

EURATEX President, Mr. Alberto Paccanelli said: “The imposition in December 2010 of a quota of 720m kg to Exports of Cotton Yarns by the Indian Government created an extremely difficult market situation with raising prices, lack of availability and severe disturbances in the T&C supply chain in the EU,” adding: “This decision by the Indian authorities is a positive sign given to the market and we hope it will contribute to alleviate the pressure and speculation that we have been witnessing in these last months”.

“The imposition of this Export Restriction by Indian Authorities, along with the one on Cotton Fibre, was poisoning our business relations with India and casting a shadow on the EU- India FTA negotiations in Textiles and Clothing,” Euratex said.

“The lifting of the restrictions on cotton yarn is a positive step taken by India and we hope that in the near future the restrictions on exports of cotton fibre will also be lifted. In this way we can solve two of the major problems affecting currently the trade negotiations in our sector,” said Mr Paccanelli.

Mr Paccanelli said the positive outcome was the result of the strong engagement and coordinated efforts of EURATEX and its members in cooperation with the Commission- DG Trade and the EU Delegation in India.

“I am very satisfied with the outcome because as President of EURATEX, I want to work for the companies, solving concrete problems and improving the business environment in our sector. I think this is a good example of a coordinated approach between EURATEX, its members and the Commission in solving a problem that was affecting very badly our companies in their day-to-day business,” he said.

EURATEX says that all export restrictions, in the form of quotas or export duties, should be banned as they are an obstacle to a free and sustainable trade environment. To achieve this objective, it says that the rules in bilateral as well as in multilateral agreements should be strengthen.